I-T - Penalty cannot be imposed u/s 271(1)(c) solely due to bona fide error by assessee while filing ITRs : HC

I-T - AO did not review emails received is not grounds enough to reject application for extension of date of personal hearing, received through email : HC

I-T - Re-assessment commenced based on unverified information contained in a complaint filed by assessee, is unsustainable :HC

I-T - CSR expenses allowed u/s 37(1) where they pertain to period prior to amendment of Section 37 which disallowed such claim: ITAT

I-T - No TDS liability can be attached on payments made for advertising/marketing services to FII which has no PE in India: ITAT

I-T - Interest paid in respect of capital borrowed for business purposes constitutes allowable deduction u/s 36(1)(iii): ITAT

2022-TIOL-840-HC-DEL-IT

Schneider Electric India Pvt Ltd Vs ACIT

In writ the High Court held that the order u/s 148A & notice issued u/s 148 for the relevant AY be set aside and that the matter be remanded to the AO for passing fresh order. The assessee is allowed liberty to file additional reply to SCN to the SCN issued u/s 148A(b) of the Act & the AO is directed to dispose of the same by way of reasoned order.

- Writ petition allowed: DELHI HIGH COURT

2022-TIOL-839-HC-DEL-IT

Pr.CIT Vs Harish Kumar (HUF)

Whether penalty can be imposed u/s 271(1)(c) solely due to bona fide error by assessee while filing ITRs - NO: HC

- Revenue's appeal dismissed: DELHI HIGH COURT

2022-TIOL-838-HC-DEL-IT

Ester Industries Ltd Vs ACIT

Whether it is fit case for remand where assessee was unable to upload reply to SCN issued u/s 148, on the I-T portal due to glitches therein, due to which re-assessment order came to be passed without considering such reply - YES: HC

- Writ petition allowed: DELHI HIGH COURT

2022-TIOL-837-HC-DEL-IT

Divij Singh Kadan Vs Pr.CCIT

Whether AO can reject assessee's application for extension of date of hearing, solely because such application was filed by email - NO: HC Whether that the AO did not review the emails received is grounds enough to reject application for extension of date of personal hearing, where received through email - NO: HC

- Writ petition disposed of: DELHI HIGH COURT

2022-TIOL-836-HC-MUM-IT

Anil Gulabdas Shah Vs ACIT

Whether re-opening of assessment commenced on the basis of some information contained in a complaint filed by the assessee, is valid, where the AO omits to probe the authenticity of the information in question - NO: HC

- Writ petition allowed: BOMBAY HIGH COURT

GST - Interest granted under Arbitral Award - Contract of year 2001 did not in any way contemplate liability of GST - It is MCGM who is liable to pay tax on Reverse charge basis - Same cannot be deducted from dues payable to applicant: HC

GST - Since the taxable turnover is below the threshold limit of Rs.20 lakhs fixed for tobacco products, respondents had no jurisdiction to issue SCN and/or pass impugned orders - Amount deposited to be refunded along with interest @6%: HC

GST - Notice as well as order impugned was passed on same date - An opportunity of hearing has not been afforded and, therefore, it is in breach of principles of natural justice - Order set aside: HC

GST - MOV-6 issued alleging bogus billing in the past - Without going into merits of case, respondent authority to release vehicle/goods, upon petitioner depositing Rs.17 lacs and furnishing bond of 65 lacs: HC

Cus - Goods are correctly classifiable under CTH 8443 32 50, order passed reclassifying under 8443 39 10 is erroneous and requires to be set aside: CESTAT

ST - Revenue cannot be permitted to build up a new case which was not taken in Show Cause Notice which is the foundation of proceedings against the assessee: CESTAT

ST - Since the order has not been served in person when it was passed or soon thereafter, presumption drawn by Commissioner (Appeals) of service of notice by speed post is erroneous: CESTAT

CX - Amount of interest and penalty are sub judice before Tribunal, this fact was admittedly in knowledge of court below, accordingly, adjustment made from amount refundable to appellant is bad and same is set aside: CESTAT

CX - It is to be reconsidered as to whether the documents on record including invoices are with respect to amounts mentioned in SCN and whether same are sufficient to falsify the allegations in SCN, matter remanded to reconsider the matter: CESTAT

2022-TIOL-835-HC-MUM-GST

Angerlehner Structural And Civil Engineering Company Vs Municipal Corporation of Greater Bombay

GST - Execution Application is filed for executing the Arbitral Award dated 23rd June 2014 passed in favour of the Applicant and against the Municipal Corporation of Greater Mumbai - It is pointed out to the Court that the Applicant, being a foreign entity, does not have a bank account in India (as the contract between the Applicant and the MCGM was concluded in 2003) - The Applicant, therefore, requested that payment under the Arbitral Award be made by the MCGM in the name of the Applicant's lawyer and agent who would credit the same into the Applicant's account in escrow for transfer to the Applicant in Austria - It was pointed out to the Court that the amounts deposited in the aforesaid Bank Account was not the entire amount due and payable under the Award but after withholding an amount of Rs.67,94,965.02 allegedly towards payment of the Goods and Services Tax (GST), and which according to the MCGM, was the liability of the Applicant - This deduction was made by MCGM by citing the provisions of Section 15(2)(d) of The Central Goods and Services Tax Act, 2017 read with Section 20 of the Integrated Goods and Services Tax Act, 2017 - Being aggrieved by the action of the MCGM, the following submissions are made; that there is no liability to pay any GST as the GST law/regime came into force much after the contract between the Applicant and the MCGM was concluded (i.e. in the year 2003) and even the Arbitral Award was passed [on 23rd June 2014] long before the GST law/regime was brought into force in the year 2017; that this being the case, the GST law had no application to the facts of the present case as it does not have any retrospective effect; that under the CGST Act as well as under the IGST Act, there was a Reverse Charge Mechanism (RCM) under which it was the liability of the MCGM to make payment of the GST, if any; that in any event, the liability towards payment of GST could not be foisted on the Applicant. Held: It is not in dispute that the services rendered by the Applicant to the MCGM would be governed by the IGST Act as the same are in relation to inter-State supply of services - In the present case, it is not in dispute that the Applicant was the supplier of services who is located in a non-taxable territory - The MCGM is a person located in the taxable territory and is not a non-taxable online recipient - This being the case, by virtue of the Notification 10/2017-IT(R), it would be the MCGM [the recipient of the service] who would be liable to pay the GST on a Reverse Charge basis as contemplated under Section 5(3) of the IGST Act - As per the contract entered into between the parties, if any taxes or duties are leviable, the same would have to be included in the rates and prices bid and would have to be borne by the Applicant - This clause does not contemplate the payment of any taxes that have arisen on account of payment of interest because of a default on the part of the MCGM to make payment in a timely manner - This is something that could have never been contemplated when the Applicant submitted its rates and prices bid in the priced Bill of Quantities under Clause 3 of the Contract - In the present case, the liability to pay GST has arisen because there were disputes between the Applicant and the MCGM on the amounts payable by the MCGM to the Applicant - Since, the MCGM did not make those payments, the Applicant invoked Arbitration which finally culminated into an Arbitral Award dated 23rd June 2014 - This Award was subjected to a challenge all the way up to the Supreme Court without any success (SLP was dismissed on 22nd November 2021) - Whilst this challenge was pending, the GST law was brought into force - It is the interest granted under the Arbitral Award that is subjected to the levy of GST under the provisions of Section 15(2)(d) of the CGST Act read with Section 20 of the IGST Act - This liability of GST (taxes) was certainly not in contemplation of the parties when they entered into the contract in the year 2001 - When one reads clauses 3 & 4 of the contract in conjunction with each other, the inescapable conclusion is that the "taxes and duties" referred to in clause 3 did not in any way contemplate the liability of GST that may arise due to payment of interest for delayed payment of any consideration for the supply of the services - This was never in contemplation of the parties when they entered into the contract - Bench is, therefore, of the opinion that clause 3 of the contract does not come to the assistance of the MCGM to deduct the GST of Rs.67,94,965.02/- from the Applicant - It is the MCGM, under Notification No.10 of 2017 - Integrated Tax (Rate) , who would be liable to pay the GST to the Government on a Reverse Charge basis and the same cannot be deducted from the dues payable to the Applicant - It is directed that the MCGM shall credit Bank Account in HDFC Bank Limited, Nariman Point, Mumbai - 400 021 with the sum of Rs.67,94,965.02 on or before 30th August 2022 - Application disposed of: High Court [para 16, 17, 22, 23]

- Application disposed of: BOMBAY HIGH COURT

2022-TIOL-834-HC-DEL-GST

Kishore Kumar Arora Vs UoI

GST - Petitioner submits that since the taxable turnover of the petitioner was below the threshold limit prescribed qua tobacco products [for being registered under GST regime] i.e., Rs.20,00,000/-, respondent no. 2 had no authority and/or jurisdiction to issue the impugned show cause notice and pass the aforementioned orders, which are assailed via the instant writ petition - Petitioner further submits that the record would show that even according to respondent no. 2, the petitioner's taxable turnover in the relevant period amounted to Rs.15,28,468/-. Held : Based on the material placed on record, it would have to be concluded that the taxable turnover of the petitioner was Rs.15,28,468/-, which is below the threshold limit of Rs.20,00,000/- fixed for tobacco products - Bench is, therefore, inclined to agree with petitioner that the respondents had no jurisdiction to issue the impugned show cause notice and/or pass the impugned orders - Consequently, the impugned show cause notice dated 21.02.2020, Order-in-Original dated 16.10.2020 and the Order-in-Appeal dated 03.08.2021 are set aside - Consequently, respondents are directed to refund Rs.18,69,400/-, deposited by the petitioner, along with interest @6% (simple) per annum within two weeks - Insofar as the relief qua compensation is concerned, the same is declined, however, liberty is given to petitioner to take recourse to an appropriate remedy that may be available as per law - Respondents are directed to ensure that the subject premises are de-sealed forthwith - Writ petition is disposed of: High Court [para 9.1 to 9.6, 10]

- Petition disposed of: DELHI HIGH COURT

2022-TIOL-833-HC-AHM-GST

MBR Flexibles Ltd Vs DCST

GST - Petitioner received Notice dated 06/01/2022 under section 129(3) of the Act, 2017 by which, the petitioner was called upon to appear before the authority on 13/01/2022 and an order dated 06/01/2022 was passed by the authority - Petitioner submits that the respondent authority has passed the order without giving an opportunity of hearing to the petitioner. Held : It is clear from the record that Notice as well as order impugned was passed on the same date i.e. 06/01/2022 - An opportunity of hearing has not been afforded to the petitioners and, therefore, it is in breach of principles of natural justice - The impugned order dated 06/01/2022 passed by respondent No. 2 is hereby quashed and set aside - The petitioner is directed to appear before the authority within a period of three weeks and thereafter, the authority shall pass order afresh: High Court [para 7, 8]

- Petition allowed: GUJARAT HIGH COURT

2022-TIOL-832-HC-AHM-GST

Kapil Hukmichand Kothari Vs UoI

GST - Petitioner is engaged in the business of trading of copper and copper scrap - Petitioner has prayed for quashing and setting aside the Order of Detention under Section 129(1) of the CGST Act in Form GST MOV-06 - Inasmuch as that the authority for detaining the goods has relied upon some transactions which have taken place between the petitioner and with regard to some other party in the years 2017-18, 2018-19, 2019-20, 2020-21 for which, no notices had ever been issued by the authority. Held : It is not in dispute that when the conveyance was intercepted along with the goods, the driver of the conveyance did produce necessary documents which are required under the Act as well as the Rules like invoice, E-way bill, Lorry receipts - After following the procedure, when MOV-06 was issued, the reasons assigned by the authority for exercising its powers under section 129 of the Act is the suppliers had “input tax credit wrongly availed or utilised by reason of fraud” - Bench disposes of the petition without going into the merits of the case by issuing following directions viz. “ On depositing an the amount of Rs. 17 lacs and furnishing the bond of Rs. 65 lacs with the respondent-Authority, without prejudice to the rights and contentions to be raised before the adjudicating authority in the pending proceedings by the petitioner, the respondent-authority shall release the vehicle and goods in question - The inquiry with respect to Form GST MOV-10 shall proceed further in accordance with law.” - Petition partly allowed: High Court [para 13, 14]

- Petition partly allowed: GUJARAT HIGH COURT

2022-TIOL-502-CESTAT-KOL

Hari Har Yadav Vs CCE

ST - Assessee is in appeal against impugned order, whereby service tax demand of Rs. 93,08,292/- was confirmed as proposed in SCN and the remaining demand has been dropped - The period in dispute is from April 2004 to March 2008 - Nowhere in entire SCN, demand of service was proposed in category of Cleaning Services and Erection, Commissioning and Installation services - However, demand has been confirmed under category of Cleaning services as is evident from impugned order - Further, demand has also been raised in category of Erection, Commissioning and Installation services - Vide specific exemption notification being Notification No. 24/2009, introduced to exempt the activity of maintenance or repair of road retrospectively for the period from 16.06.2005 onwards, a fact that the Commissioner has completely ignored and therefore, the demand is liable to be set aside - Activity of improvement of infrastructure efficiency at Level Crossing for railways cannot be classified under maintenance or repair service and that the same would be considered as construction services pertaining to railways which were kept outside the purview of service tax under definition of Commercial or Industrial Construction service during the period in dispute - The demand raised in impugned order cannot be sustained and hence, set aside - In so far as Revenue's appeal is concerned, even if the contention that the services for road were classifiable under Repair or Maintenance service, in that case also the same were wholly exempted vide Notification No. 24/2009 retrospectively for the period from 16.06.2005 onwards - Hence, no demand can be sustained - Since the appeal is decided on merits, Tribunal refrain from making any observation on aspect of limitation: CESTAT

- Assessee's appeal allowed/Revenue's appeal dismissed: KOLKATA CESTAT

2022-TIOL-501-CESTAT-DEL

Ruby Builders And Contractor Vs CCGST

ST - The issue involved is, whether Commissioner (Appeals) have rightly dismissed the appeal on the ground of limitation - Appellants are engaged in construction of residential houses mainly for Rajasthan Housing Board - SCN was issued to appellant requiring to show cause as to why not penalty be imposed under Section 77(1) of Finance Act, 1994 for non furnishing of information/ documents as required - The Commissioner (Appeals) have erred in drawing the presumption of service only on the basis of despatch of O-I-O by speed post - The law does not provide for any presumption, and proof of delivery needs to be brought on record - Impugned order is fit to be set aside - Further, O-I-O was passed ex-parte as Range Superintendent passed the order ignoring the written representation filed by appellant - Accordingly, matter remanded to Range Superintendent with direction to hear the appellant and pass a reasoned order in accordance with law: CESTAT

- Matter remanded: DELHI CESTAT

2022-TIOL-500-CESTAT-MUM

Monotech System Ltd Vs CC

Cus - This appeal lies against impugned order for having upheld the determination of classification of imported goods against Tariff Item 8443 39 10 of First Schedule to Customs Tariff Act, 1975 by assessing authority with consequent liability of duties of customs - It is seen from description corresponding to two rival tariff items that the distinction between 'inkjet printer' as claimed by appellant, and 'ink-jet printing machine' as re-assessed by assessing authorities, is the crux of dispute - The two tariff items though under the same heading part ways at the next level of classification with that of the appellant coming within 'other printers, copying machine and facsimile machines, whether or not combined' corresponding to stand-alone printers capable of connecting to an automatic data processing machine or a network which the tariff item preferred by customs authorities does not require - The argument of revenue that product literature shows the incorporation of computer within it to fulfil the same condition does not really pass muster because the capacity to be connected to automatic data processing machine or network is not the same as fitment of internal control system for operation of machinery - The two description differ on capability of external connection implying that it is a printer with possibility of varied input - It is in the light of this that the Central Board of Excise and Customs was compelled to issue clarification referred to in the decision of Tribunal in re Monotech Systems Ltd. - In view of the classification of the same product by Tribunal in a dispute of the very same importer, the classification adopted by original authorities and sustained in impugned order does not survive - Accordingly, the impugned order is set aside: CESTAT

- Appeal allowed: MUMBAI CESTAT

2022-TIOL-499-CESTAT-DEL

Quality Agencies Vs CCE

CX - Appeal filed against impugned order where the proposed demand has been confirmed due to non-production of original documents by appellant - There are sufficient documents/evidence on record - The findings in impugned order, that no documents are produced by appellants are hereby held wrong - However, it is still to be appreciated and re considered as to whether those documents and even the verification report pertains to the same invoices which are the subject matter of SCN, as has been mentioned by revenue - It is also to be reconsidered as to whether the documents on record including invoices are with respect to amounts mentioned in SCN and whether those documents are sufficient to falsify the allegations in SCN - This re assessment and re-consideration is only possible at the end of adjudicating authority below itself - Matter remanded to reconsider the entire matter in light of the documents produced by appellant: CESTAT

- Matter remanded: DELHI CESTAT

2022-TIOL-498-CESTAT-DEL

Total Energies Marketing India Pvt Ltd Vs CCE

CX - The issue involved is, whether from the refundable amount, adjustment have been rightly made for amount of interest and penalty, which is sub judice before higher court of appeal - Section 11 of Central Excise Act, 1944 grants power to Central Excise officers, being in nature of special power of recovery, which is in the nature of 'garnishee proceedings' - The Adjudicating Authority is empowered to not only adjust arrears of tax recoverable from assessee from any money/refund which is in the hands of authority payable to assessee, further empowers to issue certificate for adjustment to another Central Excise Officer who may have any money payable to assessee, and also empowers to issue certificate to District Collector for recovery of tax dues as arrears of land revenue - Such power of adjustment cannot be exercised for demand of tax/interest/penalty which is sub judice - Admittedly, amount of interest and penalty are sub judice before this Tribunal and this fact was admittedly in knowledge of the court below - Accordingly, adjustment made from the amount refundable to appellant is bad and the same is set aside - Adjudicating Authority is directed to grant the refund of balance amount in cash alongwith interest under Section 35FF of Central Excise Act, 1944 : CESTAT

- Appeal allowed: DELHI CESTAT